dagblog - Comments for "Globalization, Lost Jobs, Immigration and More"

Shorter Hal - "your chart sux

PeraclesPlease — Thu, 19 Jan 2017 06:02:21 +0000

Shorter Hal - "your chart sux, now here's my agenda again". No time to lose...

PP's chart paints a very

HSG — Wed, 18 Jan 2017 15:52:33 +0000

In reply to Nicely written, though as a

PP's chart paints a very misleading picture of how each quintile and the 5% did relative to each others over the past 49 years. The chart seems to show that the bottom 60% saw their position relative to the upper middle-class and wealthy dropping pretty consistently while there was nothing but blue skies for the top 5%.

In fact, until Reagan, the 5% were not doing particularly well relative to everybody else. Due to anti-poverty measures and affirmative action, the bottom 20% saw the greatest percentage growth in income of any of the 6 groups charted until the early 80s. Concomitantly, the top 5% saw their income grow more slowly than most other Americans did until Reagan took office.

Then tax cuts for the wealthy, the war on unions, welfare reform, and the move away from job protectionism towards "free" trade did their dirty work leading to the ugly situation we face today with ever-greater economic injustice. Since we know what caused the problem we know just how to solve it. We need to raise taxes on the rich, empower working people to join unions, tighten up the safety net, exit the trade pacts, and impose tariffs. One further point: since greater efficiencies - automation, robotization, etc. - are certainly part of the problem we also need really smart tax policy that treats expenditures on middle-class salaries much more favorably than it treats capital expenditures, top management compensation, and shareholder distributions.

To be sure, other steps need to be taken. While the bottom quintile did okay until Reagan took office the 4th quintile did not. Probable causes include declining union membership throughout this period, increased automation, declining military enlistment, and more costly higher education. It's not hard to come up with solutions to these problems as well.

Nafta was correctly defined

jollyroger — Tue, 17 Jan 2017 22:09:03 +0000

In reply to Globalization, Lost Jobs, Immigration and More

ETA the main point (ed note:the ADD is bad this afternoon...) when we talk about the good paying manufacturing jobs, what we really mean is the union jobs that happened to have been all in manufacturing. All the bullshit about retraining better include unionization of the work force. If Grad Students can organize, anyone can.

Nafta was correctly defined by Harper's Magazine as "labor racketeering" and represents the second of the dual pronged fork on which the rust belt is impaled. The chance to escape entirely the reach of the NLRB empowered the destruction of manufacturing unions.

There are some characteristics of manufacturing work forces that made industrial organization slightly easier but if the Federal government were to tip even a minute amount towards fairness in Labor Law (card check anyone) let alone actively encOuraging orgainization, service industries could be organized successfully

I can remember when the construction trades would strike, and the central labor council would sanction the strike and picket line as approved, and the Teamsters wouldn't drive a single truck to that job site.

SOLIDARITY!

What do women want? Is "equal

PeraclesPlease — Tue, 17 Jan 2017 07:56:38 +0000

In reply to Thanks for the thoughtful

What do women want? Is "equal pay" the only demand or even the major one?

Where is the cost analysis for families, both for men and women? If we look at expenses and risk throughout a life, we see: childbirth (including long periods of pregnancy), childcare, education, sickness, housing, retirement, end-of-life care, with energy and food a major sub-component.

Needs for security differ greatly, especially without a continuous record in the job market. The issue of "how one chooses (or is forced to) use one's time" can be very very different for women, and changes drastically in different stages of life, whereas for men it's typically childhood, college, work, retirement with the majority in work. Women of course can be stay-home moms, working moms, working only, quite often volunteering as part of the mix, etc.

Men's part in sharing the home life and tasks is typically still minimal. Whether they're the cash cow still varies more and more.

Thanks for the thoughtful

librewolf — Tue, 17 Jan 2017 03:59:17 +0000

In reply to Globalization, Lost Jobs, Immigration and More

Thanks for the thoughtful comments and adding to the discussion. My hope was that this would provide that sort of platform.

I went into this post deciding that I would not try to hit everything, but the major components that provide ... let's call it the warp of the story, and the weft provides varying degrees of specificity and complexity. So thank you all for doing that.

A couple of points. Household income and wages have been driven by a lot of things, some of those raised by PeraclesPlease and some by CVille Dem. Women working outside the home, and the reasons given for it, were and are explained in varying ways. As I mentioned, class was significant as poor women of all races have always worked. If we look back in time - non-war times - women of color have generally worked in both working class and even middle class families. Of course, prior to the 1980s there were not a lot of middle class and above families of color. In 'Asian' families, you had more in the middle class (even now) but you also had more small business and more multiple workers in the family. Meaning that there were extended kin in households and they were all working. This is still true in some communities. All of this to say that when you start moving in on the data and patterns interesting info starts emerging that tells us things that are important, but I did not really address in this piece.

When you wonder how cheap can labor go, you can look to the folks rushing in to the Air BnB and Uber/Lyft situation which is going to have long term impacts on the regulated (and unionized) markets. That will both surely drive wages down in the standard markets.

Back to women working. Even women may (and did) say that they were voluntarily going back to work, and that it was 'liberating', etc. However, there were a lot of fragile male egos in that mix, and concerns about men as heads of household. Divorces were much higher in the 80s (and earlier) when women's earnings exceeded their husbands. Therefore a rationalization that women were working because they 'wanted' to rather than because they 'had' to for family income is reasonable.

CVille, thanks for raising the issue of credit because it played a HUGE role in 'making up the difference' of rising coasts and stagnant (or dropping) wages. Not only credit cards, but loosening the use of taking out second mortgages and using homes as lines of credit came in to make the situation even worse. Since credit was going up (as with your friend) ultimately there was an opportunity to REALLY make some money by opening up peoples homes as a source/backing of credit. This whole situation blew up with the 2007-08 crash and folks have been much more cautious about both credit and using their homes as lines of credit. My guess is that if we don't crash again in the near future (something I am expecting to happen) then people will forget the lessons (or a younger generation that didn't get burned) will lead down the devil's path.

Interestingly, credit and class is (or was) significant. I came from the lower class, and then through my foster family a working class family, and the lesson I learned was 'debt is death.' Clearly not a message that the middle class was passing along.

What do we do?

I'm sure this will cause dissension, but my suggestion is to back out of capitalism, or at the very least defang it. Focus on smaller scales and bartering type economies to at least supplement the need for cash.

Seriously look at international unions that perhaps cover broader swathes of workers.

Seriously look at building for the long term and at fixing rather than throwing away.

As I see it, we have a major problem in that we have forced the world into our economic model. Unfortunately, it is an economy that is based on the concept of perpetual growth in an environment that is limited - and we are reaching the limits.

Women should have equal pay, or else be compensated for 'women's work' - maintaining families, taking care of all those invisible 'little' things.

These are just random thoughts. I am sure that others have ideas as well.

Thanks for this. I learned a

CVille Dem — Mon, 16 Jan 2017 19:24:23 +0000

In reply to Globalization, Lost Jobs, Immigration and More

Thanks for this. I learned a lot. I wonder though about the dual-earner household. You say that women went to work to save their families when their husbands' wages went down. No doubt that was true for many. But I also wonder if the fact of dual-earner incomes are part of what allowed wages to stay flat over the last several decades. In the 50's when I was growing up, my middle-class neighborhood saw people buying new (instead of used) cars for the first time. Vacations, which had not been a fact of life for most folks began to be a norm.

That was the time that paying men more than women was considered justified (even though it is still a fact, though no longer justified) by the fact that the father HAD to have a job and the mother had a CHOICE about it. But because the Lady of the House could get a job, all wages stayed flat.

The other factor in keeping wages down was credit cards. All of a sudden people could purchase what they could not actually afford, and this again, kept people quiet. At least until the plastic debt got out of hand for so many people. I recall a good friend who told me she needed to see a "debt specialist." I was shocked when she told me that she had accrued CC debt of $50,000! That was more than her annual salary! I couldn't believe it!

For me, using a credit card is a great convenience, and I never carry a balance, and accrue points that I can trade in for $$. Back when this all started though, it was yet another way to keep wages from creeping up.

Benefits, such as insurance, retirement packages, and other incentives, are no longer needed by industry when searching for workers at an entry level. I know that this is somewhat tangential to the subject of globalization, but not entirely so. But all this leads me to one big question:

What in the WORLD are we going to do to clean up this mess?

This was very well written.

Danny Cardwell — Mon, 16 Jan 2017 18:28:11 +0000

In reply to Globalization, Lost Jobs, Immigration and More

This was very well written. Joesph Stiglitz would be proud of the way you defanged complex subject matter. There are people trying awfully hard not to acknowledge the nationalism inside this current strain of populism. I know it's not all racism and xenophobia, but we have to be honest.

Nicely written, though as a

PeraclesPlease — Mon, 16 Jan 2017 16:30:54 +0000

In reply to Globalization, Lost Jobs, Immigration and More

Nicely written, though as a framework I think some important issues aren't discussed and I'm sure I don't agree with several conclusions.

First, if you go back and look at the supposed "glory years" of manufacturing below, the wages for the bottom 2 quintiles weren't growing either - not much at quintile 3 either.

Second, there's not any discussion of prices and costs, and with most of US inflation occurring in only 4 parameters - healthcare, education, energy and housing - it's easy to imagine that this didn't have to happen, and can be reversed. Education is largely driven by the increasing loan profit tied to the nervousness around lack of opportunity without that degree. Healthcare we pay 2 1/2 times other industrial countries for not appreciably better healthcare. Energy has been pushed and manipulated to a good degree by wars and blatant price fixing (not just cartels). Housing has largely been "subsidized" (to our detriment) by the mortgage deduction along with the myth that housing is a good investment (Nate Silver dispenses with this in a chapter of Signal and Noise, where housing only saw appreciable gains in the 90's, after which that rare new opportunity shut).

Third, competition for customers increased greatly in the 90's, especially with eCommerce that meant you could pay half price online. There really was no extra profit - margins were cannibalized as consumers got to shop around.

Fourth, the flirtation with offshoring worked with some industries, failed with others (e.g. the costs and difficulties erased any gains). We have a much more rational sense of this than 10 years ago and labor costs have adjusted globally.

Fifth, there was a huge opening of 2nd and 3rd world labor when the Wall fell and countries from East Europe, ex-Soviet Union and China were able to compete in the free market, something we didn't have to deal with in the 80's. Prior to that, helping the 3rd world poverty meant a few alms to Africa (that's not that populous). After that, we added at least 2 billion more to the job pool, glutting supply, even though not all supply was sufficiently skilled.

Probably more comments later when I have time.